Housing Market Meltdown! Mortgage Crisis! Recession! Recession! Recession! The media sure is being an awful killjoy these days, aren’t they? Since when did the fourth estate care so much about real estate? Can’t they bring us some good news? Can’t they compare the market meltdown to rich, gooey fudge, or the collapse of our economy to a light-hearted game of Jenga?
As the news of the market grows increasingly dour and consumer confidence sinks further into the toilet, a few voices have arisen hither and thither, proclaiming that the market may not be as bad as it seems and that now may still be a good time to buy. Some of these voices go so far as to claim that our negativity may be our own worst enemy. One such voice belongs to Mr. Bob Mathe, a Realtor for Coldwell Banker quoted in the Oshkosh Northwestern. Mr. Mathe had the following wisdom to share:
"The market really hasn't been bad here. We're still selling stuff.”
Great news, Bob! “Stuff” is good, and “selling stuff” is even better. Really! Kudos!
Cultural and commercial meccas such as Oshkosh, which are ostensibly more recession-resistant, are seeing growth in housing prices. Mr. Mathe seems to think that it can only continue to go up, right? Because that’s not at all what people were saying before the market burst everywhere else. Could a guy named “Mathe” have his numbers so wrong? Heaven forefend! So why aren’t people buying?
When in doubt, blame the media:
"If the media would stop talking about it, people would not be so hesitant."
You’re right, Bob. I’m sick and tired of these party-poopers telling me to prepare for a storm. Sign me up for a dozen pre-construction condos. I just can’t go wrong!
But it isn’t just biased peons like Mathe that are preaching good vibrations. Seasoned guru Suze Orman also just released an article in which she states that buying a house now may not be such a bad idea, but she’s careful enough to specify areas of particular caution.
“All those stressed-out developers are motivated to make deals. That can mean sharp price discounts or great offers to help with your mortgage financing,” she advises, but is quick to remind readers that being surrounded by half-finished homes is hardly conducive to your home’s value appreciating. For a real horror story on this subject, see this recent article from the AP about residential projects abandoned or delayed in the wake of the housing crisis. Empty homes, new or not, can have serious ramifications for those living or investing nearby. This definitely applies to home buyers considering foreclosure properties as well.
With recent polls declaring that 60 percent of Americans will not purchase a home in the next two years, it’s no wonder that people like Mathe are rallying the consumer. These are lean years ahead, and even Orman’s position, at heart, is a carefully frosted bitter pill that ultimately admits that only a select few are in any position to be buying a home at this time, and even those who can find the funding and commit to “stay put for at least five years” are taking a risk.
So bring on the doom and gloom. Wishful thinking and betting on imaginary wealth are what caused the housing crash and the mortgage crisis, and erring on the side of caution may take a toll on the economy as a whole, but it’s the only way one can ride out this recession. “Buy now”? Don’t buy it...
This was a guest post by Trenton Flock, Web Editor at NuWire.